In most years, we have a normal yield curve which is upward sloping because a longer term
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Question:
In most years, we have a normal yield curve which is upward sloping because a longer term generally carries greater risk and investors demand higher yields on long term debts. But the yield curve has been inverted since July 2022 (See the current yield curve on Page 10 of the PP slides) while the U.S. economy has been humming in the past two years. What does the inverted yield historically signal about the economy? Is the signal wrong this time?
Yield Curve mentioned below:
Related Book For
Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
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